Trademark protection is changing — and I don’t think I like it

While a brand and a trademark are terms that are often used synonymously and interchangeably, they are, in fact, two different things.

The former is a broad and multi-layered concept, which arguably defies definition. A brand is something you know, something you see, something you feel. By contrast, a trademark is very easily definable. Legally, in fact. The federal Trade-marks Act states that a trademark is a “mark that is used by a person for the purpose of distinguishing or so as to distinguish goods or services manufactured, sold, leased, hired or performed by him from those manufactured, sold, leased, hired or performed by others.”

Notwithstanding the legal and practical differences between a brand and a trademark, the latter is an integral and inseparable component of the former. It would be difficult to maintain a strong consumer brand without distinctive and identifiable words and logos associated with it.

A trademark registered under the Act is a powerful asset. It provides owners with the ability to protect their trademark and enforce their intellectual property rights in it across Canada. It serves as a public notice on the Canadian Intellectual Property Office (CIPO) database that that trademark is taken and not available for anyone else to use. And it provides acquirers of businesses knowledge that the target company has secured strong, enforceable rights in its intellectual property assets. In essence, it is the starting point for the legal means by which your brand is capable of being protected.

Trademark registration is very valuable and, by extension, often very contentious.

Now look back to the statutory definition of a trademark, above. It contains a very important verb – “used.” A trademark is a mark that is used. The concept of use has been a fundamental tenet of trademark law for generations. One must actually be using the trademark in association with its goods and services in order to secure federal registration and broad rights of enforcement. After all, if you are not actually using the trademark, then why should you get to own the exclusive rights to those words and designs, to the exclusion of others?

As a result, when you apply for a trademark in Canada, you do so either on the basis of actual use of the mark, or proposed use of the mark. And if you are applying on a proposed-use basis, you effectively have three years from the date of application to demonstrate that you have used the mark in order to get registered. Otherwise, you are in danger of having your application cancelled.

Makes sense, right?

Well, in 2019, this is all about to change, and brand owners need to give serious consideration right now to what impact this might have on protecting their brands. At some undetermined date next year, the Trade-marks Act will undergo some major amendments, the most impactful of which is the elimination of the use requirement as a condition to trademark registration.

In other words, people who apply for trademark registration will now be able to achieve it even if they have never used, and don’t ever use, that trademark.

That means that if you currently use a trademark, that thing that forms the foundation of your brand, but if you have not applied for it with CIPO by the time these amendments come into force, someone else may be able to get it registered. It also means that if you are thinking of using a trademark in the future, but don’t take steps to apply for it before the enactment date of these amendments, someone else might snap it up and obtain registration ahead of you.

And those people, those “trademark trolls,” won’t give up your valuable intellectual property assets without a fight or, more likely, a cash settlement.

Also, currently, when you apply for a trademark with CIPO, you are charged a filing fee of $250 and you can apply for as many types of goods and services as you want. However, when these new amendments to the Act are in force in 2019, trademark applicants will be charged a separate additional fee per class of goods and services applied for. As a result, getting trademark applications submitted for marks you might use in the future will never cost less than they do right now.

So, brand owners out there – start taking inventory this year of your past, present and future trademarks and make sure you are taking the proper steps to protect them by way of applications and registrations with CIPO under the Act. Because if you don’t, someone else very well might — and hold your brand for ransom.